RNE - ReNu Energy

[So_Cynical]

Re: GDY - Geodynamics Limited

So whats going on with GDY. There has been no announcments for quite some time. Have they got the 1mW plant up and running. I am starting to become a little frustrated with not a lot being done on time..not to mention the share price heading down to hopefully some support at about 72cents.

Trav

I would like to suggest that you look 3 posts back, geothermal power plants need at least 1 production well to operate...for true believers this sideways trending share price should be seen as a great opportunity.

 

[Smurf1976]

Re: GDY - Geodynamics Limited

So whats going on with GDY. There has been no announcments for quite some time. Have they got the 1mW plant up and running.

That should be 1MW not 1mW - the latter wouldn't be enough to run a single mobile phone whereas the former would run close to 1000 houses.

 

[So_Cynical]

Re: GDY - Geodynamics Limited

On a day when almost everything went up, GDY was hitting new 12 month lows, the chart suggests that there could be support in the high sixtys...all things considered not much has really changed since the Habanero blow out 10 months ago , the only new negative was the (inevitable) ETS getting delayed.

At the current Share price Geodynamics still has a market cap of over 200 mill and is sitting on 90 odd mill in cash with no debt...what is a concern is the 6 million a quarter cash burn and the fact that any real income (selling renewable power) is still many years away.
~

 

[Tukker]

Re: GDY - Geodynamics Limited

Hi So_Cynical, and other supporters.

This fella was triggered in a scan i did last week, and looks interesting.

Shareholder Registry:
The recent spike in the selling volume (15mil on the 23rd March)a result of Robert Anthony Healy selling his 8%stake in GDY for whatever reason. Sunsuper Pty Ltd (new investor) and Sentient Executive GP II Ltd (original investor) seems to have bought all that he sold.

Fundamentals (not my strong point):
It has spent the better part of 9 years laying significant groundwork towards a completed project only to be lowered to almost their starting share price. Hiccups happen all the time, work then continues on. Can anyone provide a doomsday event that could trigger a total company meltdown with more than 40% probability? I lay this as my fundamental analysis, as rough and basic as it is.

Technically:

Long term buying pressure since 2008 has run its course to levels seen during 2005 -2006 period, and has neared its all time low of 47c on March 15th when it hit 57c. More recently the support of 63-65c has held true and the share rebounded on both occasions.

Now the recent buying following the Robert Healy sale has been consistent with the start of a consolidation/recovery phase. We haven't seen 2 higher troughs in a long time all with accompanied consistent volumes, not random spikes of spontaneous buying.

My opinion:
Need about another week worth of price data for me to be satisfied, and I am totally prepared to see the price drop to 50c before a significant consolidation pattern emerges between 50 and 60c.

I would imagine there could be a lot of money to be made on this one in the coming year baring that 40% company killer event if anyone can name it.

Upside potential 150%

 

[So_Cynical]

Re: GDY - Geodynamics Limited

Fundamentals (not my strong point):
It has spent the better part of 9 years laying significant groundwork towards a completed project only to be lowered to almost their starting share price. Hiccups happen all the time, work then continues on. Can anyone provide a doomsday event that could trigger a total company meltdown with more than 40% probability? I lay this as my fundamental analysis, as rough and basic as it is.

Technically:

Long term buying pressure since 2008 has run its course to levels seen during 2005 -2006 period, and has neared its all time low of 47c on March 15th when it hit 57c. More recently the support of 63-65c has held true and the share rebounded on both occasions.


My opinion:
Need about another week worth of price data for me to be satisfied, and I am totally prepared to see the price drop to 50c before a significant consolidation pattern emerges between 50 and 60c.

I would imagine there could be a lot of money to be made on this one in the coming year baring that 40% company killer event if anyone can name it.

Upside potential 150%

At last some decent questions and analysis...thanks Tukker

My Point of view is that GDY simply cannot fail..the technology is proven, so the rest is a given...GDY will eventually be a major Australian producer of renewable energy, perhaps the biggest player in that field.

As far as i can see this is the consolidation point...and the SP over the medium term should rally (my med term is 3 to 6 months)...ive been watching this stock for 5 years and perhaps now is the time? as far as im concerned there is no black swan/doomsday event that can destroy this company.

Disclosure: ive been watching forever but don't hold, and never have held...but im seriously considering as i have been for 5 years...if memory serves i actually had a low ball buy order in about 14 months ago at the "bottom" but it didn't get filled.

 

[Tukker]

Re: GDY - Geodynamics Limited

So a 25 MW plant slated for commission in 4 years. But their plan is to build 10 50MW plants correct?


How does proximity to main electricity consumers affect GDY? They seem to be miles away from the majors.

Meh... im gonna stay with technicals, the other stuff gives me a headache.

*awaits a technical entry point*

 

[akkopower]

Re: GDY - Geodynamics Limited

My Point of view is that GDY simply cannot fail..the technology is proven, so the rest is a given...GDY will eventually be a major Australian producer of renewable energy, perhaps the biggest player in that field.

I was under the impression that there were risks that could severely damage share holder equity.

Numerous capital raising needed if they have too many problems.

coal is cheaper, nuclear is cheaper.
http://www.nucleartourist.com/basics/costs.htm old but valid and

http://www.geodynamics.com.au/IRM/Company/ShowPage.aspx?CPID=1464

transmission costs are high

the hot rock is not hot forever, it does cool down, anyone know the life of a well?

How much water will be lost per kilowatt? Is it negligible?

 

[akkopower]

Re: GDY - Geodynamics Limited

Is this technology proven in australia?
I am under the impression that similar processes have been going on for years in canada and iceland (90% of their power comes from this, no ref just memory).

I was under the impression that their processes involve pumping the water near geo springs which are heated as a result of magma and hot stuff in the earths crust. Whereas the heat for GDYs process comes from radioactive rocks. The reason for GDYs rock being hot is from all the heat being trapped as a result of the 5kms of insulation, as heat is removed from the system, heat is lost forever.

I believe that there is a very slight chance of a dooms day event occurring that will destroy the company, but there could be many instances where shareholder value could be harmed, severely.

Is this really a renewable energy, when u have sucked all the heat from the wells there will be none left. How often will they have to change the heating fluid, how will this be filtered? What volume of fluid is used per well?, must be on the order of Giga.

If the water is around 200C a lot of minerals will dissolve in it, what will be the effect of scaling. As the water passes through the heat exchange will precipitation be a problem and cause sudden blockages...... kaboom. How much will additives cost to reduce this scaling, what will be their environmental effect.

 

[Smurf1976]

Re: GDY - Geodynamics Limited

So a 25 MW plant slated for commission in 4 years. But their plan is to build 10 50MW plants correct?


How does proximity to main electricity consumers affect GDY? They seem to be miles away from the majors.

Single 25MW plant - just running a new transmission line to the outskirts of the existing grid should be sufficient. But for a 500MW plant there would need to be some fairly significant spending on transmission.

Ultimately, it will come down to the cost of delivered energy that determines whether GDY and geothermal in general sinks or swims. Don't forget it's not just competition from conventional coal / gas, there's also the likes of LNC with their underground coal gassification technology that are serious contenders for alternative means of supplying baseload generation.

 

[So_Cynical]

Re: GDY - Geodynamics Limited

Ultimately, it will come down to the cost of delivered energy that determines whether GDY and geothermal in general sinks or swims. Don't forget it's not just competition from conventional coal / gas, there's also the likes of LNC with their underground coal gassification technology that are serious contenders for alternative means of supplying baseload generation.

Smurf...ultimately it will depend on the level of price support that the state and Fed Govt's provide to the renewable energy sector....renewable energy production IS BEING SUPPORTED FINANCIALLY BY BOTH LEVELS OF GOVT, and will continue to be well into the future, that level of support and the cost of delivery will both be the determining factors.

I personally reckon LNC is a dead duck as there's to much potential down side environmental risk...however i must admit i haven't been following there progress lately?

 

[bocky]

Re: GDY - Geodynamics Limited

there is no way you should be going anywhere near this stock

-yes; sounds attractive
-yes; big resources, asset has life of 20 years plus
-yes; technology proven
-yes; they will raise about >$500m before they will make a profit, if at all.

There are plenty of other stocks on the market with attractive stories. GRR and BRM are good if you want come capital raising risks. At least they will give you some positive cash flows.

Coal seam gas companies offer enough risk in this underground energy space. What about ESG or AZO?

 

[akkopower]

Re: GDY - Geodynamics Limited

there is no way you should be going anywhere near this stock

-yes; sounds attractive
-yes; big resources, asset has life of 20 years plus
-yes; technology proven
-yes; they will raise about >$500m before they will make a profit, if at all.

There are plenty of other stocks on the market with attractive stories. GRR and BRM are good if you want come capital raising risks. At least they will give you some positive cash flows.

Coal seam gas companies offer enough risk in this underground energy space. What about ESG or AZO?

Can you please elaborate on this

Why the lack of confidence in the profit making ability of the company?
Why will they raise >$500m b4 the job is done?

Do you have sound reasoning or just crystal ball type stuff.

 

[So_Cynical]

Re: GDY - Geodynamics Limited

They have like 90 mill in cash bocky, and i think Origin energy is still giving them money :dunno: then there's all the Govt money (12 mill last time i think) and then there's the Hunter valley speculation upside...imagine how the SP would take off if they had some good drilling results there, so close to Newcastle and the central coast.

 

[Smurf1976]

Re: GDY - Geodynamics Limited

Smurf...ultimately it will depend on the level of price support that the state and Fed Govt's provide to the renewable energy sector....renewable energy production IS BEING SUPPORTED FINANCIALLY BY BOTH LEVELS OF GOVT, and will continue to be well into the future, that level of support and the cost of delivery will both be the determining factors.

Not strictly true about government support for renewable energy.

What has actually happened is that the Australian Government itself has largely ceased supporting it, instead opting to legislate that consumers will provide support to the renewable electricity industry up to a pre-determined set level in 2020.

A fine point maybe, but the support is coming straight out of your pocket by means of the higher electricity bills you will soon be receiving. It is not being paid via your taxes. Government has simply decided that you and all other consumers will support renwables but government isn't really contributing much directly.

 

[akkopower]

Re: GDY - Geodynamics Limited

They have like 90 mill in cash bocky, and i think Origin energy is still giving them money :dunno: then there's all the Govt money (12 mill last time i think) and then there's the Hunter valley speculation upside...imagine how the SP would take off if they had some good drilling results there, so close to Newcastle and the central coast.

What do u mean by Origin is still giving them money.

Is this part of the deal they made with origin or is it just dilution

 

[Smurf1976]

Re: GDY - Geodynamics Limited

I personally reckon LNC is a dead duck as there's to much potential down side environmental risk...however i must admit i haven't been following there progress lately?

Ultimately, LNC is aiming to produce syngas and has two thoughts about what to do with that gas - either turn it into liquid fuel, use it to generate electricity, or both. A third option would be to simply build a pipeline sell the gas to an existing power station or other third party (Torrens Island power station comes immediately to mind).

Overall, it's a different business despite both being in energy.

LNC is comparable to the CSM industry a decade or so ago - doubts about production processes and not sure what to do with the gas once it is out of the ground. But at the end of the day, they have a flammable gas product which, if it can be produced cheaply enough, ought to be able to find a buyer either directly or via LNC's own liquids / power plants. The rivals are the conventional fossil fuel industries - coal, oil and natural gas.

GDY is basically a renewable energy company hoping to grab a slice of the Mandatory Renewable Energy Target (MRET) market which government has created. The rivals are the other developers of renewable electricity generation in Australia, primarily from wind but also from other sources including hydro, biomass and solar.

In my opinion it comes down to oil prices. If oil is cheap then LNC's gas has no real use other than as fuel for electricity generation, thus leaving LNC as some form of integrated mining (gassification) and power generation company - basically the same business model as any other power generator which produces thier own fuel despite using a different technology.

On the other hand, if oil goes to $200 per barrel then it won't make sense to burn gas (either natural gas or LNC's syngas) to generate baseload electricity when it can be far more profitably be used, either directly or in liquefied form, to replace oil.

 

[Tukker]

Re: GDY - Geodynamics Limited

But but but but, it went up 13% since this thread got active again. :

Fundamentals haven't changed. Risks are the same they have been for at least the last couple of years, and the price has shown strong support around 66c repeatedly.

Besides that, how many green thumb funds are obliged to invest in these kind of companies? Can't share inventory and demand from these "bubble creators" increase the value of this company without any real valuations? Pump it baby!

Looks like its reached a top technically at 67c, I'm hoping to see a minor retraction to 65c and perhaps a new trough formed with higher lows.

 

[gohawks]

Re: GDY - Geodynamics Limited

Any thoughts on GDY's continual price drop? Down to 0.40 today which looks to be an all time low. Is the dropping price of oil having an effect? Possible upcoming cap raising?

I do already hold just starting to wonder if i should be accumulating some more at this price.

 

[Tukker]

Re: GDY - Geodynamics Limited

Don't think the fundamentals have changed, but to be honest i haven't looked. Chart is abysmal. The recent drop could be assumed a result to world affairs, the market has been jittery. 40 cents is the lowest its been as far as i can tell, that's usually a bad sign, pray for a consolidation level to form around 40c and maybe you can scrape some losses back with some time.

I never go on board GDY due to no free capital, and im glad i didn't.

To be fair, I am completely out of all renewables for the future. A presentation by Mr Gates at the prestigious Ted Talks event basically threw me right off.

Be afraid, Be very afraid - Terrapower

 

[xilehelix]

Re: GDY - Geodynamics Limited

This is def a long term hold stock... renewables are for the future. Buy now when it's low and you'll be rewarded in 5 years. Especially geothermal, prob the best of the bunch... not determined by the elements as nuclear powered heat from the Earth's belly is uninterrupted.